NIC and payroll taxes require time and concentration!

There are detailed calculations involved on monthly and weekly basis to fulfill your NIC, PAYE and PAYG obligations in time. We handle it precisely and calculate right amounts for you and your employees. So that you and your employees are satisfied regarding their tax matters.

 

In UK there are NIC and PAYE relevant to payroll taxes. In Australia PAYG is used to keep track of employee's income tax. Here is a brief description of these.

 

National Insurance Contribution (NIC)

All businesses in UK are required to submit National Insurance Contribution (NIC). It is applied on both employed and self-employed individuals. There are different rates governing NIC, some are fixed and some depend on profits.

Class 1A NIC If you provide your employees with benefits including car and house, you will have to pay Class 1A NIC. Current rate of Class1 NIC is 12.8%

Class 1B NIC If you make expenses payments to your employees or give them benefits, and you include these in a PAYE Settlement Agreement, you may have to pay Class 1B National Insurance contributions. The Class 1B National Insurance contributions rate for the 2008-09 tax year is 12.8 per cent

Class 2 NIC If you are self-employed, you will have to pay a fixed rate of Class 2 NIC at a rate of GBP2.40 per week

Class 4 NIC Class 4 NIC is payable on taxable profits of self-employed individuals. Below upper limit rate of Class 4 NIC Is 8% of profits, and above upper limit it is 1% of profits.



 

Pay As You Earn (PAYE)

Pay As You Earn (PAYE) is a system of UK taxation in which employers have to deduct income tax and NIC from their salaries at the time of each pay period and submit it to HM Revenue & Customers. Thus employee's tax liability is fulfilled at the time of receiving the payment.

Employers have to submit PAYE and NIC to HM Revenue & Customers monthly or quarterly. In case of late or under payment employers are charged interest. At the end of the tax year an annual return Employer Annual Return (form P35 and P14).

Form P45: When new employee join you, they will provide you form P45. When any employee leaves you, you are obliged to provide him P45 form.

Form P46: If you new employee doesn't have a precious Form P45, you'll have to complete Form P46 for him.

Form P60: For each employee who was working with you at 5th April, you have to issue a form P60. This form shows employee's pay and tax for the whole year.

Form P9(T), P9X: These forms are related to PAYE and provide tax codes for employees to be used in tax year.

Form P7X: If budget requires any change to be made in tax codes, this form is used to make those changes.

Form P11: Form P11 is used for each employee for proper details keeping of pay and deductions throughout the year.

Form P14: For each employee, employer need to complete Form P14. This form must reach HMR & C as late as 19th May.

Form P35: This form is used to provide details of all of your employees, stating amounts of salary, Income Tax and NIC.

We offer our services to submit your NIC and PAYE returns monthly and annually, to keep proper record of these items. If you outsource your payroll to us we'll also be handling all your PAYE and NIC record keeping and filing requirements. However if you are maintaining your payroll by yourself, you'll need to provide us with salary details so that we can extract relevant information to fulfill filing requirements.

 

Pay As You Go (PAYG)

Pay As You Go (PAYG) is a system of Australian taxation in which employers have to deduct income tax from employees' salaries at the time of each pay period and submit it to Australian Taxation Office (ATO). Thus employee's tax liability is fulfilled at the time of receiving the payment.

You are under PAYG withholding obligations if you:
- are an employer
- are running a business that has contract workers, or
- are making payments to other enterprises that do not quote their Australian Business Number (ABN).

You have to withhold amounts in regard with income taxes of you have employees, or pay employees of other businesses. The same requirement applies on directors of your company, payment are to be deducted from salaries of directors as well for their services, it also applies on contract works i.e., deduct amounts on payments you make to them.

If any business do not quote their Australian Business Number (ABN) you must also withhold an amount from payments you make to other businesses.

You have to report and send all amounts withheld during a period to ATO. If you are an employer and subject to withholding you must

- register your business for PAYG withholding
- work out the status of your workers
- Get full understanding on what kind of payments you have to deduct taxes
- Carryout calculations to withhold amount
- Provide status reports to ATO about amounts withheld and submits amounts to them
- At each tax year end provide an annual repot summarizing payments made and amounts deducted

We provide all payroll and tax related services to businesses in UK, Australia, USA and Canada. These services include processing payroll, withholding taxes, submitting online return, and providing you updated status and reconciliations. These services greatly reduces your accounting and taxation costs while ensuring quality reporting at the same time. Click inquire now to contact us today to start right away.